Author Question: ABC Insurance retains the first 1 million of each property damage loss and purchases reinsurance for ... (Read 105 times)

mmm · **on:** Jul 11, 2018

ABC Insurance retains the first 1 million of each property damage loss and purchases reinsurance for that part of any property loss that exceeds 1 million. The insurance for property losses above 1 million is called

A) excess insurance.
B) liability insurance.
C) coinsurance.
D) primary insurance.

Question 2

Which of the following statements about an excess insurance plan is true?

A) The insurer does not participate in a loss until the loss exceeds the amount the firm has decided to retain.
B) The insurer pays first up to some specified level; the insured then pays all losses exceeding the insurer's retention level.
C) Losses in excess of a specified amount are not covered.
D) The insured and insurer share equally in any loss that occurs.